Slightly more than a month after it confirmed
he was leaving his post as President and CEO, the Mortgage Bankers Association
(MBA) announced that David H. Stevens would remain at the head of the trade
association. Steven’s resignation and
appointment as president of Sun Trust Mortgage was announced by both MBA and
the parent company of his new employer, Sun Trust Bank, on May 30. The announcement came almost simultaneous
with Steven’s first year anniversary with MBA.

In a statement released this morning MBA
said they were pleased to announce that Stevens “has agreed to stay on as
President and CEO.” MBA Chairman Michael
W. Young said that, “Over the past several
weeks, MBA’s leadership, members and staff impressed upon Dave the important
role he was playing for the industry and his unique qualifications to lead the
association. The importance and
significance of MBA’s voice during this critical time coupled with Dave’s
experience and talents encouraged us to do all we could to retain him.”

“The past few weeks have been extremely
difficult for me personally and professionally,” Stevens said. “After serious thought and consideration, Isimply cannot leave the MBA at such a critical time for the industry and the
association. Frankly, at the end of the
day, stepping away now when so much progress is being made and so much still
left to be done, did not feel right.

“Going
through this experience left me encouraged by the tremendous opportunity that
lies within our industry and reinforced the essential component mortgage
finance will continue to play in helping our nation’s economy recover.” he
noted.

Stevens joined MBA in May 2011 after serving as Assistant
Secretary of Housing and Urban Development and Commissioner of the Federal
Housing Administration (FHA).

Mr. Stevens was to have joined the Company on July 16, reporting to SunTrust Mortgage President and CEO Jerome Lienhard.

“We have a strong leadership team in place, and continue to execute our business plan and serve the needs of the clients of SunTrust Mortgage,” said Mr. Lienhard.

WASHINGTON – The Obama Administration today convened a meeting with more than 50 local government and business leaders to discuss the role of sustainability in economic development and job creation. The gathering coincided with the third anniversary of the creation of the Partnership for Sustainable Communities, a landmark collaboration between the U.S. Department of Housing and Urban Development (HUD), the U.S. Department of Transportation (DOT) and the U.S. Environmental Protection Agency (EPA).

WASHINGTON – U.S. Housing and Urban Development Secretary Shaun Donovan today announced HUD will speed federal disaster assistance to the State of Colorado and provide support to homeowners and low-income renters forced from their homes due to the ongoing High Park and Waldo Canyon wildfires this month.

Suspicious Activity Reports (SARs) related
to suspected mortgage loan fraud (MLF) filed by depository institutions decreased
sharply in the first quarter of 2012 compared to the first quarter of 2011 even
as SARs increased overall. Data on these
MLF SARs filings was released Tuesday by the Treasury Department’s Financial
Crimes Enforcement Network (FinCEN).

There were 17,651 MLF SARs filed during
the quarter compared to 25,484 one year earlier, a decrease of 31 percent. At the same time there were 205,301 SARs of
all types, an increase of 10 percent from 186,331 in the first quarter of
2011. MLFs represented 14 percent of all
SAR filings in that earlier period compared to 9 percent in the January-March
2012 period.

FinCEN said there was an unusual spike
in MLF SARs filings during the first three quarters of 2011. These arose primarily out of mortgage
repurchase demands on banks which prompted a review of loan origination
documents and subsequent detection of suspected fraud. Filings in early 2012 show that problems
continue to emerge from loans originated in the pre-2009 period which accounted
for the majority of delinquencies and foreclosures experienced since 2008.

Of the MLF SARs filed in the first
quarter, 28 percent related to loans that were four to five years old and 44
percent to loans that were more than five years from their origination data. One year ago 79 percent were three or more
years old.

While only a minority of filers included
loss totals and fewer did so in 2012 than in 2011, more than 80 percent of the
losses reported were for amounts under $500,000. Very few filings (51 in 2012) reported any recovery
of losses.

Numbers of SAR were logically the
largest in the largest states – California, Florida, New York, and
Illinois. On a per capita basis California
was in first place as it was during all of 2011. Nevada ranked second, rising from fifth place
in 2011 and Florida was third. Los
Angeles had the highest number of MLF SARs of any of the large metropolitan
areas both by volume and on a per capita basis.
Two other California MSAs, the Riverside area and San Jose-Sunnyvale
were second and third on a per capital basis followed by Las Vegas and Miami.

To determine the latest trends in
suspected mortgage fraud FinCEN examined a subset of MLF SARs filings reporting
activities that were less than two years old. Nineteen percent of 3,354 MLF SARs filed during
the first quarter met this criterion and FinCEN examined a sample of 334 or ten
percent. The largest category of
suspected fraud was defined as income followed by occupancy, employment, and
debt elimination. Compared to the Q1
2011 report, debt elimination fraud increased as did foreclosure rescue scams
while appraisal fraud was down.

FinCen reported an increasing number of
SARs that appeared to involve “repeat subjects.” For example, several foreclosure rescue scam
reports noted that numerous borrowers had complained about the subject
organizations. The same was true of some
SARs related to proposed debt relief services.
Filers also noted several short sale SARs subjects who had been involved
in numerous fraudulent transactions.
This information could provide useful information to law enforcement.

FinCen also identified fraud patterns not
noted in other reports. One was homeowners
insurance fraud where borrowers pocketed insurance payments after home fires
and another, “Keys for Cash” where persons moved into bank owned properties
claiming to have long term leases. Their
true objective appeared to be inducing lenders into paying them to vacate the
properties.

In a related matter, the Department of
Justice and the offices of the Inspector General for both the Department of Housing
and Urban Development and the Federal Housing Finance Agency held mortgage
fraud summits in two cities on Tuesday to help protect homeowners in areas
hardest hit by mortgage scams. A third
summit slated for Tallahassee, Florida is being rescheduled because of severe
weather in the area. The summits were
organized by President Obama’s Financial Fraud Enforcement Task Force’s (FFETF)
Mortgage Fraud Working Group of which FinCEN is a member.

“Preventing, detecting and
prosecuting mortgage fraud is a top priority of the Financial Fraud Enforcement
Task Force and its Mortgage Fraud Working Group members,” said FFETF Executive
Director Michael Bresnick. “It’s more important than ever that we arm
homeowners with the information they need to recognize the predators up front
and empower them to avoid falling victim to these devastating scams. That’s why
the task force is holding these summits in states hit hardest by the
foreclosure crisis.”

A Florida loan officer has been
sentenced to four-and-a-half years in prison and ordered to pay $9.2 million in
restitution to the Department of Housing and Urban Development (HUD) for his
role in a mortgage fraud scheme that targeted the Federal Housing
Administration (FHA). Alejandro (“Alex”) Curbelo of Miami had pleaded guilty to
one count of conspiracy to commit wire fraud in April. In addition to 54 months of incarceration he must
serve three years of supervised release.

According to documents filed in the U.S.
District Court in Miami, from approximately February 2006 through July 2008
Curbelo, then a loan officer for Great Country Mortgage Bankers in Miami,
assisted in the sale and financing of condominium units at Dadeland Place and
Pelican Cove on the Bay. He assisted borrowers to obtain loans who were
unqualified due to insufficient income, high levels of debt, and outstanding
collections.

Curbelo admitted that he conspired with
others to create and submit false applications and other documents to FHA on
behalf of the borrowers and to offering cash back to the borrowers as an
incentive for them to purchase the units.
The closing costs were paid on behalf of the borrowers by interstate
wire which enabled the wire fraud charges.

After the loans closed the unqualified
buyers failed to meet their required payments and defaulted on their
loans. HUD, which insured these loans,
was required to take title to the units after foreclosure and pay lenders the outstanding
balance of the loans. The fraud cost HUD
more than $9.2 million.

The case was investigated by the HUD
Office of Inspector General as participants in the Miami Mortgage Fraud Strike
Force and the Finance Fraud Enforcement Task Force.